On Monday, Blackrock (BLK) introduced its revised Bitcoin Spot (btc) Proposing an exchange-traded fund (ETF) in a bid to appease regulators, likely boosting its odds of receiving first-of-its-kind approval in the US.
Under the updated proposal, Blackrock’s ETFs would have cash creation and redemption mechanisms, the model favored by the Securities and Exchange Commission (SEC). The world’s largest asset manager is the latest of several firms to update its proposal amid speculation that the Securities and Exchange Commission may approve a slew of bitcoin ETF applications as early as January.
Blackrock first filed for the iShares Blockchain and Tech ETF last month, proposing an in-kind redemption model.
However, the Securities and Exchange Commission scrutinized the proposal, raising concerns about investor safety and market manipulation. ETFs typically feature one of two types of redemption and creation mechanisms: in-kind or cash.
The in-kind redemption structure, which many companies say is more attractive to investors, enables companies to redeem shares for bitcoin held by their ETFs. Cash redemptions, which the SEC considers the safest and most accessible redemption option, replace those shares for their equivalent cash value.
Blackrock is the latest of several companies to agree to issue cash refunds until in-kind refunds are approved. More than a dozen companies have applied for ETFs so far. Arc 21 shares It also published a revised version of the S-1 With a similar change.
The SEC has delayed several ETF applications by Grayscale, Ark 21shares, Vaneck, and Hashdex.
Update (December 19, 04:55 UTC): Updated with additional context and information.